MTN, Oando in robust retail expansion drive

. . . Telco to roll out 200 service outlets across country
Ben Uzor Jr

Driven essentially by the need to address pressing customer management demands and also to bring services to the door step of its teeming subscribers, mobile network operator, MTN Nigeria in strategic partnership with Oando Plc, yesterday disclosed plans to grow its retail presence with the roll out of 200 service outlets across the country. This, MTN further pointed out was another demonstration of its unflinching commitment to bring best-in-class services to its numerous customers.

Under the terms of agreement, MTN disclosed yesterday that a hundred of the service outlets would be deployed on the premises of Oando filling stations spread across the country. Currently, Oando Plc, sub-Saharan Africa's leading integrated energy group providing imaginative solutions to the region's energy challenges, has 600 retail filling stations across the country, and this, according to MTN explains why it decided to partner Oando.

“It is pertinent to add that in addition to the utilization of Oando premises, our Connect points will also spring up in many other open spaces including university communities nationwide”, Akin Braithwaite, customer relations executive, MTN, stated yesterday. He further revealed that MTN intends to deploy these service centres in the 774 Local Government Areas (LGAs) in the country. The service outlets tagged, ‘MTN Connect Point’, according to Braithwaite, forms a strategic part of the firm’s comprehensive customer outreach programme known as ‘Walk-in Service Everywhere’ (WISE).

He added that the primary aim of this initiative was to improve MTN’s customer experience by bringing services literally to their doorstep. “A typical Connect Point consists of a branded kiosk operated by a Connect Partner. The cost of the kiosk is borne by MTN. Each Connect Point is fully equipped with modern technology an is manned by two personnel who will carry out a bouquet of services, including SIM swaps, bill payment, query resolution, SIM registration, assistance to customers with product or service activation or set up, and customer enlightenment, amongst other services”, Braithwaite posited.

According to him, MTN had conducted extensive studies to establish where these outlets are most needed and thus deployment would be based on these findings. This strategy, he added was guided by MTN’s determination to ensure that none of its esteemed customers ‘needs to go too far to find competent support and assistance that will enable them derive true value from MTN’s products and services’. In the same vein, Rabiu Umar, head of retail, Oando Marketing, said that the firm’s desire to provide unmatched service experience to its customers was the rationale behind partnering with MTN.

“1 in 5 Nigerians buy petrol from Oando filling station and 1 in ten Nigerians use an MTN line. It is a synergy that would definitely work wonders. It is difficult to get customer service as Nigerians waste valuable man hours travelling long distances to experience MTN products and services. I think it is a very proactive initiative. At Oando, we will do everything to ensure that this partnership is a success”, he concluded.MTN continues to invest billions of naira into providing the best technological platform to improve customer care.

check out ma blog, www.benedictspace.blogspot.com

Nigeria needs a national broadband policy– Opeke

MainOne Cable Company, West Africa’s first wholesale broadband capacity company recently celebrated its first year of commencing operations in Nigeria and delivering unmatched broadband services to Nigerians. Funke Opeke, chief executive officer of the company in an interview with select IT journalists’ talks about the challenges and prospects of broadband deployment in Nigeria. She says government must encourage infrastructure sharing in order to address the country’s last mile challenge. Ben Uzor was there.

Operations in the last one year

We have been in operation for almost one year, and we are delighted to note that in this first year we have connected majority of the large telecom operators and internet service providers in Nigeria and Ghana to the Main One network. We believe undoubtedly that we are the number one provider for wholesale internet into the West African market today. However, we are not pleased with the amount of progress we have made in bringing broadband to the overall population. And so that is the focus for going forward. We have done a great job of maintaining an extremely reliable network, and our network has maintained 100 percent availability since we launched a year ago. Even with some challenges, we are able to ensure 100 percent availability on our network for our customers. So our focus now is that have a stable operation and have connected majority of the operators and internet service providers, is to find ways to service the majority of the population that is still yearning for more broadband, higher speeds, low prices, easier access to such services.

Challenges

The challenges are one of distribution. We brought a big cable with a lot of capacity to the market and, we reduced the price points. Wholesale internet price points have dropped significantly, but what we find is that the infrastructure on ground to distribute is limited. And in the areas where better infrastructure or longhaul national backbone networks, metrofibre networks exists for example, it is controlled in a proprietary nature whereas an open access cable, any one can connect to us at a uniformly low price. The prices for accessing such capacity is prohibitive and so it limits how close to the consumer we can get with the capacity that we have brought into the region without building the network ourselves. Of course it is not cost effective. I guess every time we need power which is what we do in this country you buy a generator. It is not cost effective for us to start doing that all over again for domestic networks and so we are looking to work with the rest of the industry regulators to open up channels for us to move the capacity that we have available in our landing stations more effectively to the consumers who want that. And it is a mix of policy action, industry action and also the operators building up their networks, internet service providers building up their networks so that we can effectively get this capacity to the consumers who want these services.

MainOne’s Contributions to NCC’s broadband plan

We are in touch with the NCC and we have been requested to provide input on some items just recently and we also have our own initiative, providing input and policy papers to present what we think needs to be done in terms of a national broadband policy. We do not think that is something unique to Nigeria. The United States which is the most advanced technology in terms of ICT has a national broadband policy because they said broadband is becoming what electricity was to the industry and so for economic development to take place, and to ensure that for United State to remain competitive, they have easy and affordable broadband access for all their citizens. The International Telecommunications Union (ITU) is calling for a multifaceted national broadband policy because they see that it is critical to development, and clearly we as the stakeholders trying to facilitate broadband see that as essential for Nigeria in terms of its aspirations towards development, job creation, and improved education. We need to do more from a national policy standpoint, in terms of how we are going to stimulate broadband and ensure that the benefits actually accrue to the Nigerians who need them the most.

Partnership with Glo-1

I think we co-exist, and actually we co-exist well. I don’t see that particular area as a challenge. I think in most markets, you have multiple cables because you want diversity. And should things go wrong, then the country and the operators in that country still have connectivity to the internet. We’ve had instances in Egypt where three cables were cut and so it was difficult to get access to that country. But the availability of multiple routes allows for constant connectivity. An analogy would be having only one airline coming into Nigeria and if that airline were grounded, people cannot travel out, which would be a faulty model. Where the challenges exist is in the national backbone. If we look at things today, the price of moving capacity from Victoria Island to Ikeja in some instances is higher than the cost of our moving that same capacity from Lagos to London. As you may note, even the international voice calling prices to London, New York and major cities have come down considerably, but calling across networks in Nigeria is still at a higher cost. So clearly that is not directly related to the cost infrastructure. It’s related more to the approach to the market and that’s where collaboration is required because a lot of national backbone networks have already been built. The right of way are along government roadways. Concessions have been granted. But concessions have been granted to deliver services in an open and balanced manner as opposed to a proprietary manner for the exclusive use of the person who built the infrastructure. And if we continue to have frameworks where things can only be utilised for the exclusive use of the person who constructed the infrastructure, when public assets are involved in delivering bills, then the best interest of the population is not being served. And in other markets where you have open policies for accessing such infrastructure in a fair and balanced way, the investor needs to be rewarded, they need to be able to get their return but the price also needs to be determined in a way that is reflective of the real value and to ensure that the policy objectives of the country, of the regulator are being met. I will say for Nigeria, if we want to develop economically, we have to increase the adoption of ICT, we have to get better connectivity into our schools into our universities. We have to get better connectivity to government establishments, our businesses have to be better connected to increase productivity and market reach. And so this is critical for us as a nation to get this right and that is why all of these bodies, ourselves included, are advocating a national broadband policy that lays out a pragmatic roadmap on how we can get the capacity that is now available across the shoreline, so to speak, of Nigeria to the hinterlands.

Thrust of national broadband policy

The key issues that should form the thrust of the policy is a review of the national backbone, access, availability and Interconnection. Look at the industry structure. Do a cost and price determination study and see if it is been managed in an open manner or what kind of rules or policies need to be in place with respect to infrastructure sharing on the backbone. In addition the NCC needs to look at matters of spectrum and frequency and distribution and look at what policies or what objectives we are trying to effect and how some of those resources are being allocated to actually achieve the objectives. Also evaluate how when they are allocated they are managed to achieve those objectives. If these resources are allocated but there is no enforcement, then those resources are now not being deployed to achieve what we set out to achieve; which is get broadband to the masses. We need to ensure we are putting the things in the right places where it is driving the right results. And I would say at this point in time for Nigeria, clearly ICT adoption, internet connectivity, broadband availability are what we view as the next major milestone. Voice connectivity is in most parts of the country today. You can be reached via a mobile phone for voice conversation. What we need is data for our use, for our work places, for business, for job creation, commerce, security monitoring, more effective law enforcement to be able to send which data over the internet and have instantaneous remote monitoring. All of these are critical issues. Clearly we need to get broadband across the country and that’s what we see. It is opening up the infrastructure that exists and setting the framework for sharing access to the infrastructure.

Listing on Nigerian Stock Exchange

Main One is a wholly African owned company. The company and its shareholders are constantly looking at ways to maximize their return on investment. A lot of the companies that invested in Main One directly and indirectly are publicly listed institutions. So it is not unlikely that they may like for us to move in the direction that opens up the ownership of the business to other members of the society as well. We haven’t made a decision to do that yet but it is something our current owners may look at doing if it helps bring more capacity and enhance those values that will move the company forward. In the meantime, we will continue to deliver the value that we set out to deliver in terms of broadband service penetration and also to achieve return on investment for our investors. When we do make a decision in that regard, I am sure you will be among the first to know. With respect to Phase II, we thought we would be doing more in Phase II but in reality as we’ve discussed, the challenge of distribution, just the insatiable demand in our market that we’ve really struggled to meet has consumed more of our energy and resources. As discussed earlier, putting more into building domestic distribution as opposed to expanding the network has been the focus. We are looking more closely at that now. We believe that extending the Main One system to the South South region of the country is of utmost priority. If we think of the main developmental objectives there, if we look at the means to get capacity to that part of the country today and the cost of doing so, we believe that another solution is urgently required. So we are focused on working on that with some degree of urgency. In addition we see the need to continue to go south and extend the cables to other countries down south West Africa, so to speak. So we are putting more attention on that now with particular emphasis on another landing in Nigeria in the South-South region. 10 years of GSM, we think it is a wonderful thing. Look at what policy shift and effective regulation and private sector capital is able to do. We think it provides a model in terms of what can be achieved if you look at regulation. We also want to highlight likewise we are talking about the issues of distribution and a broadband policy, shared infrastructure on national backbones, when shortly after GSM companies came in, they had to fight on issues of interconnect, and interconnect regulation and that really facilitated the growth of the multiple networks, the competition and the reduction in prices that we have seen over time. In the broadband arena, we think of effective regulation, right policy, and private sector participation to drive growth. We are looking forward to a phenomenal decade of growth in driving broadband and having to seek more impact on our economy. We would also like have more indigenous impact on our economy. We say this for Nigeria where we operate, we say the same thing for Ghana where we also operate and have good traction with our business in Ghana. . The business there is managed and run by Ghanaians. We are hoping to drive indigenous value into that economy by partnering with Ghanaian internet service providers. Connecting schools, connecting government offices, connecting businesses to bring economic development in our region.

Assess partnership with Global Crossing and Seacom

Global Crossing is a Tier 1 internet provider that we have partnered with recently. Currently most of the internet traffic originating or coming back into Africa is actually switched in Europe. So when we came into service last year, if you give us traffic and we are sending it to connect with your friend here in Nigeria...even though we have an internet exchange here, we send traffic to be effectively connected by the operators to reach Tier 1 providers in Europe, switched in Europe and then brought back into Nigeria. What we are doing with Global Crossing is we are building an IP NGN (Next Generation Network) platform in West Africa. Traffic originating in West Africa, terminating in West Africa should not have to go Europe to get routed back into the region. If the traffic is what goes to other part of the world, then this means that Global Crossing as a Tier 1 internet service provider is one of the top ten movers of traffic of the global internet. So we have partnered with them to route that traffic through their network to other parts of the globe. However, in concert with that, we have put infrastructure in place that ensures that traffic originating in West Africa, stays on our network, and we can route it to a terminating node that is connected to us on the internet. With respect to Seacom, Seacom runs a similar infrastructure where they also have that kind of IP connectivity down the east coast of Africa, and what we have done is connect our networks in London so we can provide services across the region. So all the way from Nigeria, Ghana through to the countries down the east coast of Africa, Kenya and South Africa being the most prominent, we can deliver services to customers in these places.

Return on Investment

We are still investing, because as we mentioned we are compelled to invest more in enhancing distribution infrastructure than anticipated. We have put in a new IP network to switch this traffic in Africa. That’s new investment. We are interconnecting with other networks; so that’s new investment that we are making around the globe to interconnect with these networks. So we are still investing. I think the outlook on ROI remains positive. We have built up a healthy business within one year. We are self funding our operations and funding these additional investments. So we have stable business and the outlook is good. But do we have a return on investment to the original investors as of yet? We are still working to achieve that objective.

Broadband penetration

I think we need, when we look at the size of the youth population, and I would bring that a little differently, when we look at our objective in terms of employment, job creation, security, I will say we need to set a goal as a country on what we want to achieve within what period. And I will say realistically that you should start seeing real impact in 12 – 36 months. 12 – 18 months you should start to really feel a lot of what’s going on. So I believe the way I would approach it is for the government to say we need to get to 40 percent penetration. And what is it going to take to achieve that in this period. If you look at recent economies and a lot of examples who have similar policies in place, for example, South Africa, Kenya, some of these countries are high internet users and they have declared what it is that they want to achieve in terms of broadband penetration. When we bring that home, we want every school to be connected, we want every police station to be connected, we want every local government to be connected, and we want every community of a certain size to have this kind of access. So if we put that kind of policy in place we can start to think practically about how do we achieve this? What kind of policy frameworks do we need at what period? What kind of incentives do we need? Who are the parties that we can work with to make this happen? And then I could say that if we set milestones in 12 months, 24 months, 36 months, we have a clearer plan on what we want to achieve.

Estimated investment

In terms of the task force, I am not sure. We have seen GSM take off. We have seen GSM penetration rates above 50 percent, led by the regulator and the private sector. So I think it’s a policy framework, enforcement of the policy framework, working with the private sector. I don’t see the need for a separate task force but as part of that, if the government feels there’s need for a taskforce, then we would see how that really adds value to the process. But I think we have the institutions on ground and the bodies on ground to do this. It is really engaging them and setting the goals and say what do we need to do differently? But I don’t know that we need new bodies or new structures necessarily. Certainly perhaps, more focus on ICT at the Federal Government level might be interesting. There’s already the Ministry of Communication, the NCC, there’s the Ministry of Science and Technology, there’s NITDA, we have enough agencies. I think maybe not task forces. We just need to be clear about who has the mandate to do this. We believe the NCC is the regulatory body for our industry; they have to regulate telecom operators and internet service providers. So they have the lead responsibility on this. They can set up policy and enforcement and work with the industry to achieve it. So we don’t know if there’s a need for a task force. In terms of investment, we invested $240 million initially to get the cable in service. We have made some other small investments. I will say we have probably made close to $250 million at this point in time that we have invested in the network overall.

Broadband strategy and infrastructure sharing

The infrastructure is the key thing. So it’s a mix of things. As we said, share infrastructure where it exists. We think it’s a mix of leveraging what’s already on ground and ensuring it is being used efficiently and also augmenting that with new builds perhaps in the rural areas where fibre does not currently exist. The major routes in the country today, multiple fibers already exist. So why can’t we jump on that and start right away leveraging that and retrofitting that? The retrofit is necessary, not a whole rebuild to ensure that Nigerians can start benefitting from fast broadband almost right away. So, yes it is infrastructure related. It is ensuring we open up and have right rules for deploying infrastructure. It is issues of right of way even to get into some of those rural areas. How many government agencies do you have to go through? What kind of fees do you have to pay to deploy infrastructure? You have to pay the Federal Government, the State Government, the Local Government and the local area boys in town to get your infrastructure deployed and each one is a separate negotiation and process. They take multiple months. And then we really have to get the equipment in place to do the work. The skills; you see how long it takes. So, yes, it is infrastructure related. But we will be missing a huge opportunity if we don’t look at what is already in place that we can leverage. Two reasons: Time – we’ve been hearing things about Vision 20:20 and all that. So time clearly is an issue in terms of the global market place and the global market economy and having Nigeria catch up and become more competitive and diversify from what we know it as a single commodity economy to a multifaceted economy. The other is actually the cost of production and being able to now manufacture goods, export agricultural products and process them. Deliver services out of Nigeria. If we keep building infrastructure over infrastructure, without ensuring we have a healthy framework for accessing existing infrastructure, we are just making the cost of production in Nigeria artificially high. We think that at the end of the day we don’t achieve our objectives because we cannot be competitive on a global basis. It is because the costs of delivering those services out of Nigeria are still high. Let’s look at what exists and how best to achieve this policy requirement. It is not just saying that everybody should go build because if everybody goes build and build ten networks on top of each other, then everybody is trying to recover their costs. You build a mini cartel. The consumers pay multiples of what they would be paying in other markets. This is when someone has to reproduce a service or a document and send it over that network in Nigeria; it’s going to be 10 times more expensive than what it is to do that in an economy where they have figured out how to share that asset. And so the cost of transmission is 10 percent of what you have here.

Government intervention in telecoms

It’s a difficult one. What I would say is that as a nation we need to think of how we leverage ICT to achieve our developmental objectives. When you look at other economies, it used to be the industrial age and now we are clearly in the Information age and Nigeria as a country has not participated in any meaningful way other than as consumers of information technology. If we are going to build our economy and create wealth for our people, if we are going to create jobs for our young people, if we are going to create service industries here, as in India, in China, in Malaysia, in Philippines, IT has been one of the key enablers of jobs. I think the ITU says over the past decade, IT has been the largest driver of job creation anywhere in the world. Nigeria wants job creation, how are we going to use IT to do that? I think it is when we have that framework; we can start to say within that framework how do we help the industry develop to ensure that those economic development objectives are achieved. So I don’t think the government should be going out and helping companies on a case by case basis just because they are distressed because you do not necessarily understand the reason for that distress. But I think that to the extent that you have a framework for how we want to support ICT, how we want to use ICT to expand Nigeria’s economy, how we want ICT to grow, once we have that, then within that framework we can look at the structure of the industry, we can look at the players of the industry and say where should the government be providing more support so we can actually achieve that vision.
I do believe that in that context, if that is done, that yes, there are some sectors or some parts of our industry today in Nigeria that could benefit from support. Look at ISPs, I want more indigenous service providers otherwise we are going to wipe out all of the indigenous service providers. How are we going to serve the rural areas? How are we going to serve the secondary cities? Why can we not support those ISPs to deliver services in those areas? I worked for Verizon in the US, when you think of how many people they employ and the good jobs they have, how many service providers that they have, deploying broadband into homes, setting up networks, call centres for services, billing, all the things that go with that. These are good quality jobs that afford people a good standard of living. So we have to think about how we use ICT to do all that in our industry. We are powerhouse in West Africa. If we start doing that, Nigerian banks all over, how can they start doing more financial processing? Why should we send a lot of our financial transactions to Europe out of Africa? Can West Africa, can Nigeria become a processing hub for that? Of course with ICT we have this reputation about security and 419. We can build all the structures to make this secure, to authenticate the transactions. We have all these biometric capabilities. We can make it secure. We can build that infrastructure. We can build expertise in security to wipe out this reputation we have for 419. We can train our young people to do that. So clearly that is what I see is the opportunity to do a lot of these things.

Commitment to customers

First of all we want to thank our customers for the confidence in us and for giving us the opportunity. Coming into the market as a new company and becoming number one in delivering wholesale services to them demonstrates significant good faith towards us. Without having those customers, we would really still be struggling to sustain ourselves as a business. So we appreciate the trust and confidence they had in us to give them the opportunity. We believe we have been of good service to them in this first year that we only think we are at the beginning of the journey together. Our focus is to continue to deliver more wholesale value with the speed we have. There’s a lot in terms of broadband service platforms and application service platforms, cloud computing, additional services that we can provide on a wholesale basis for internet service providers, telecom operators to take to the market. So we can leapfrog in this broadband revolution that we are trying to achieve in West Africa. And to our customers, we just want to say thank you. We want to continue to partner. We have started a Partner Advantage Programme where we are starting to work with them more closely to accelerate this deployment of broadband. We will continue to invest in that. We will invest in our partners to ensure that jointly we can achieve this vision and partner in success together.

Telkom loses N157 billion in failed Multi-Link’s venture

Ben Uzor, with agency reports

More facts have emerged on why Telkom South Africa failed in Nigeria’s highly competitive telecommunications market. Roy Padayachie, minister of communication, South Africa disclosed, yesterday that Telkom did not succeed in Nigeria due to its acquisition of a Code Division Multiple Access (CDMA) operator in an industry dominated by the lower cost Global System Mobile (GSM) technology. He further revealed that Telkom’s failed Multi-Link transaction in Nigeria has cost the firm over N157 billion (R7 billion).

Padayachie was responding to a written parliamentary question by the Democratic Alliance’s Niekie van den Berg, who wanted to know the reasons for Telkom’s failed efforts to gain ground in the Nigerian telecoms market. Still on the reasons for Multilinks poor performance, the minister added that the rapid expansion of the network that had to be implemented could not be supported by the underdeveloped distribution channels, thus affecting sales revenue.

According to him, “Some contracts were entered into which did not deliver the anticipated benefits and incurred significant operating expenses. The worldwide economic troubles also affected the Nigerian economy. Multi-Link did not have sufficient market share, pricing power or strategic and operational advantages to be successful in the resulting tight economic environment.” Telkom’s Multi-Links unit suffered an operating loss of R522 million for the financial year ended March 31, 2009, and R1.039 million for the year ended March 31, 2010.

“In addition Telkom has been required to write down goodwill and assets of R5.823 million,” Padayachie said. Replying to another question — by Juli Killian of the Congress of the People — he said as one of several shareholders in Telkom, the government raised its dismay at the write-off of “approximately R5.2 billion in the Nigerian operation at the Telkom AGM in 2010. “Telkom underestimated the highly competitive nature of the Nigerian telecoms market and also failed to build and manage appropriate distribution channels,” he said.

These, indeed, are not the best of times for CDMAs - also known as Private Telephone Operators (PTOs), as a significant number of them are finding it extremely difficult to survive the stiff competition in the nation’s telecommunications industry. Analysts who spoke with BusinessDay said low capitalisation, poor promotion of CDMA technology, subscribers’ preference for GSM telephony, and corporate governance issues have seen the fortunes of these CDMA operators dwindle over time.”The greatest problem confronting CDMA companies in Nigeria is funding. They are not as highly capitalised as GSM operators. So, they do not have the same level of coverage or reach.

“Also, the ease to change from one network to the other gives GSM operators an edge, whereas CDMA operators have to buy handsets and subsidise them. This adds to their costs of operation. If a handset is faulty, GSM subscribers can easily buy another handset and simply transfer their SIM card, but for CDMA, it is not like that. And most times, the subscribers have to buy another handset and reprogramme their old numbers. That is one of the reasons why CDMA is not really growing,” Oladipupo Alabi, a telecoms engineer, told BusinessDay. Gbenga Adebayo, president, Association of Licensed Telecommunications Operators of Nigeria (ALTON) has, meanwhile, advised the Federal Government to find ways of supporting ailing CDMAs, adding that a bailout from government could enable them expand their network, strengthen existing product offerings and roll out innovative services. “This is not necessarily talking about consolidation, but some kind of relief that can be granted to them to deploy infrastructure better. This is like a bailout from government”, he said.

check out ma blog, www.benedictspace.blogspot.com

Nigeria may become largest mobile payment market in Africa – experts say

Ben Uzor Jr

Nigeria may indeed be positioning herself to become the largest mobile payment market in sub-Saharan Africa, analysts said at the weekend. According to the analysts, there are only 22 million individuals who have a bank account out of the 150 million people but there exists about 90 million mobile phone users, which provide huge opportunity for the development of mobile payment.

M-payment through mobile phones, however has been identified as a viable tool to provide basic financial services to millions of unbanked populations in urban and rural communities in Nigeria, and will become a booming industry. Analysts say that Nigeria was gradually moving towards the era of mobile payment system as operators and the regulator make every effort to sustain the shift from card-based transaction to mobile-based transaction.

Emmanuel Okogwale, principal consultant, Mobile Money Africa told BusinessDay at the weekend that mobile payment market looks interesting and will thrive to become the largest market in Africa depending on the collaborative efforts of the stakeholders. “I see strong internal migration driving mobile remittances, strong compelling services like agency banking for the underserved communities.

“Depending on the numbers of final licensees in Nigeria, the market looks promising for potential players. The stakeholders should endeavor to build a shared agent network to serve all the stakeholders. Since agency is the heart of mobile financial services and the agents do not sell primary products of the licensee unlike in MNO driven ecosystem.

There is a need to source, develop, train and deployed agents on a shared basis. Only recently, the Central Bank of Nigeria (CBN) issued additional seven approvals in principle (AiP) to prospective mobile payment service providers in the country. The issuance of the seven new AiPs takes the number of approvals to 23. Some of the companies included in the latest bazaar are Zenith Bank, MoneyBoxAfrica and Zinternet. The names of the other companies were not available at press time yesterday.

There are speculations that VTN and Hendomark made the list. Meanwhile, an informed source close to MTN told Business Day at the weekend that the telecom company’s would match the achievement of M-PESA service, offered by Kenyan telecoms operator Safaricom. With about 14 million users representing 81 percent of Safaricom’s customer base in Kenya – M-PESA is described by the GSM Association, a global body representing the interests of mobile operators, as the world’s most successful m-payment service.

According to our source, the telecom firm intends to apply lessons learnt in markets where it has rolled out the service such as Uganda to succeed in Nigeria. In Uganda for instance, after one year of rollout, MTN’s payment service exceeded that of M-PESA at the same stage. A key factor in the Ugandan success is marketing through 2500 representative.

Our source said that MTN strongly believes direct contact and educating telecoms subscribers are critical to growing the mobile payment service. Also important is easy access to cash remitted to users, or enabling them to convert cash into e-money which was achieved in Uganda through agents such as village shop owners, the source further disclosed.

Tayo Oviosu, CEO, Pagatech, an electronic financial services firm and one of the firms given the approval in principle by the Central Bank, said given the poor number of Nigerians, mobile payment and banking takes advantage of the wider coverage by mobile phones.

“There are very few people that have formal access to financial services, only about 20 per cent of Nigerians have access to formal financial services and 90 per cent of the bank accounts have less than N5000 in their accounts. This shows that majority of the money in Nigeria is outside the banking industry and this poses a very real challenge to banks today. They open bank branches everywhere, yet the issue remains unaddressed”.

check out ma blog, www.benedictspace.blogspot.com

New Evidence Act paves way for electronic evidence in courts

• CFIN lauds Jonathan
Ben Uzor Jr

Computer Forensics Institute, Nigeria (CFIN), the government-approved body for the training and certification of digital forensics experts in Nigeria, has commended President Goodluck Jonathan for the swift way his administration signed into law the new Evidence Act that has now paved the way for the admissibility of computer and electronic generated evidences in Nigerian courts.

Peter Olu Olayiwola, president/chairman of the body in a press statement, at the weekend, congratulated Nigerians on this noble feat achieved in the early stage of the President Goodluck Jonathan’s administration heaving a sigh of relief that at last digital and computer forensic evidence is now admissible in the courts of our land.

He said with this development there’s hope for this country even as he expressed the gratitude of CFIN to all those in the forefront of fighting for the realisation of the new Evidence Act. The body was exceptionally grateful to Senator Sola Akinyede and his committee and the National Assembly for working tirelessly to push through the amendment of the 68-year-old Act.

Olayiwola explained the role of CFIN to nation building and said his institute works in the area of national security by assisting the federal and states law enforcement agencies, and other agencies of government that have to do with security in the area of capacity building by developing the capabilities in the identified staff that man certain critical areas in their various organizations.

While introducing computer forensics as the science of detection and investigation of crime committed either using the computer or on the computer network, internet and other digital devices with the intent of giving digital evidence in litigation, Olayiwola said computer forensics can be used to detect and gather evidence that will lead to the prosecution of the culprit. According to him, over 75 percent of all criminal cases have one form of digital or electronic evidence or the other.

Further, he said there is no country in the world that is absolutely crime free but that what advanced and forward looking nations have done was to use technology to ameliorate and investigate forensically any time a crime was committed to be able to bring the perpetrators to book.

Olayiwola therefore said with the amendment of the Evidence Act that the coast was now clear for the full practice of computer forensics in Nigeria assuring that Nigeria will witness a new era in her legal and judicial system. According to him, Nigerians can now make full use of the expertise of certified digital and computer forensics examiners as expert witnesses in their court cases as is the case in countries with the same type of Nigeria’s new Evidence Act.

check out my blog, www,benedictspace.blogspot.com

MainOne has scaled hurdle of availability and affordability in broadband market- Oladepo

Kazeem Oladepo, general counsel for Main One Cable Company, a wholesale bandwidth provider in this interview with Ben Uzor Jr draws out strategies to address Nigeria’s last mile challenge. He talks about the need to develop a national broadband policy that would focus on the demand and supply side of internet services, spanning both regulatory and economic intervention plan by government.

Question 1:
What’s your assessment of Nigeria’s telecommunications market in terms of regulatory framework and business environment?

The numbers (statistics) we see support the premise that the industry has grown enormously in the last decade or so, when viewed from where this market was at that time and where it is now. At 65 percent or so tele-density and 90 million active (by NCC’s criteria and records) subscribers, there is a clear indication of phenomenal growth and advancement in the industry. Not that there are no shortcomings in the current framework, but telephony is no longer a luxury item for everyday people in Nigeria, and that’s a quantum leap from where we used to be, which must be acknowledged with glee.

Government should be commended for providing the framework for market liberalization i.e. legislative consistency incorporated in the Communications Act and other subsidiary regulations, and heralding the emergence of a truly quasi-independent regulator that was able to instill confidence in investors and helped to bring the much needed FDIs into the country to develop the industry. The regulator deserves enormous credit for nurturing the growth and sustaining it through the different phases of evolution so far, whilst the entrepreneurs who took the initiatives and the risk to invest in the Nigerian telecoms market when the fear of uncertainties were still lurking deserve loads of credit for their tenacity.

Overall, there is a general feeling in the industry that the regulatory framework revolving around the Policy, the Act and the NCC, as well as industry participation has been instrumental to an impressive run of sector growth so far. The question is whether this framework is properly poised to support future advancements, or there is a need for it to be recalibrated to meet emerging industry trends both and today’s Information Communication Technology (ICT) challenges facing Nigeria. I believe the answer to that will be yes, we need a revamp. On the business environment, I believe this is more matured today and will continue to get more sophisticated as the market evolves. It would need to be supported by an appropriate framework that we are talking about to bring home the expected market dividends.

Question 2:
The CDMA segment of Nigeria’s highly competitive telecommunications market has continued to show signs of distress. Experts have called on the federal government to provide a bailout to aid their recovery. What’s your take on this? From a regulatory standpoint, how can the NCC assist ailing CDMA operators?

Advocating bail out, whatever that means, for the CDMA operators without doing a root cause analysis of their predicament is conveniently missing out on the real issues. We all know that businesses fail to meet performance objectives for diverse reasons, which could be from management of the business itself to other market externalities, including the regulatory environment or general business environment itself in terms of product/services and simple factors of demand and supply.

In the case of the CDMA operators, the technology is also an issue for consideration and whether or not this conveys a market advantage or is a major cost and service innovation disadvantage is an important point to consider. Generally, and quite ironically, I believe the current unrest in the CDMA segment began with the Unified Access Service License initiative, which in itself was a well-conceived service liberalization effort by the NCC, in that it removed the exclusive mobility service status conferred on the GSM operators and created a one-stop shop license for operators who are able to procure the license and removed barriers to compete if you had the scale and deep pocket.

It was meant to create a level play-ground. I doubt that the framework actually considered the fact that the play-ground was heavily lopsided in favor of early entrants in the mobility market to understand that the impact on competition was not going to be addressed by simple change in the licensing regime. Let us put it this way: you have 50 acres of farm land to farm, then you give “Farmer A” 5 acres. 2 years later, you withdraw the land and give 45 acres of it to “Farmer B” exclusively for 5 years, after which you now give “Farmer A” the right to farm in any part of the 50 acres where he can find a foothold.

Do you think Farmer A, without clear and precise guidelines being implemented to grant and protect his access would thrive as a business in that environment? I bet the answer is no. Some of the CDMA operators, i.e. Multi-Links, were successful businesses when they were smaller and focused on corporate/enterprise fixed line business, where they had a niche. Starcomms was a leading Data solution provider. The moment these guys went after the retail mobile business, they took a hit trying to play along-side the deep pocket GSM operators who were more entrenched in the market and had gained critical mass.

The existing framework either didn’t factor adequate competition mechanism to protect late market entrant from incumbents’ whims, or found it tedious to enforce the bit of market rules that where available and could have offered protection to the new and smaller guys. For instance, it is interesting that there was no asymmetric interconnection termination rate in this market until 3 years after full license liberalization (2009) and there are still no effective competition mechanism and policy incentive addressing the specific fate of these smaller operators, without which they will not be able to contribute to the overall competitiveness of the market.

Question 3:
Even with proliferation of submarine cable systems, Nigerians especially those in the hinterland will not have access to efficient and affordable broadband services due to the absence of last mile connectivity. How has this impacted Main One’s operation in terms of service availability and cost?

The advent of the Main One Cable system signifies an increased availability of 2 Tbps, more wholesale international connectivity capacity on the shores of Nigeria, available for deployment and proliferation of high speed broadband internet access to the Nigerian consumer and improved local and international connectivity services, including voice and video services. It also meant cheaper bandwidth options, priced at 80 percent less than the cost of capacity prior to the Main One cable, and improved service efficiency with 100 percent service uptime in our services from inception in July 2010 till date.

What we have done is scale the hurdle of availability and affordability for the market. Now, how do we resolve consumer accessibility? Delivering broadband services in Nigerian has its peculiar challenges in the wake of high cost of deploying access infrastructures and the high prices of leasing or sharing such infrastructure from other operators, in the few instances that they are willing to share. The feeling in the past was that there were limited last mile solutions on ground, wired and wireless, trailing the failures of the incumbent (NITEL).

Today, however, there are considerable fibre optic and wireless infrastructures all over the place connecting cities, build out by the incumbent mobile operators and other providers of national long distance backbone services, which can be used to implement the first phase of capacity delivery into these cities for further metro delivery through other existing network and new last mile and access build-outs. The cost of these access infrastructure, for instance for leased lines between Lagos and Abuja, or even between Victoria Island and Ikeja in Lagos, are in most cases twice as more expensive than the cost of capacity between Nigeria and London on the Main One cable system.

Consequently, there is great disincentive for penetration of services in not only the hinter land, but locations even within Lagos, whilst those that are lucky to have it are neither fully enjoying the impact of the crash in prices that Main One cable and others such as the Glo 1 cable have brought into the market, nor the improved service uptime. It is also part of the explanation for lower international call rate compared to local call rates in Nigeria.

Question 4:
What do you think the Regulator and service providers such as Main One could do to address the challenge of last mile connectivity?

I believe the way to go is infrastructure sharing supported by strong access regulation that not only mandate clearly the sharing of access and distribution infrastructures, but also regulates prices of these facilities, including wholesale leased lines services, to encourage cost based incentive for further build, whilst at the same time nurturing competition and service penetration. We currently have an infrastructure sharing Guideline, which I believe is not particularly clear on the inclusion of infrastructures such as leased lines in the list of network facilities to be shared, even though these are already being transacted between operators in the industry, albeit at discriminatory rates.

The guideline does not prescribe or regulate the pricing of access and infrastructure sharing, more or less leaving it to commercial negotiation between the contracting parties. It is hard to imagine in such asymmetric relationship, where one party is a dominant network operators with every incentive to be protective of its market and create barriers to entry, that the negotiation will be fair and rate not discriminatory as is currently manifest in the current cost of these services today.

Conversely, the fear might be that since we have not attained optimum level of proliferation of infrastructure, wouldn’t regulating price discourage further investment and stifle future build. In reality, sharing and cost based, transparent and non-discriminatory pricing of access and distribution infrastructure will immediately improve service penetration in broadband deployment, create new market opportunities through improved services, and thus competition, which will drive further investment in new infrastructures by the initial sharing operators.

As a matter of fact, it will bring more efficient infrastructure build into the industry given that today’s intercity backbone build, for example, are largely needless duplication of resources where each operator is lining up on the same route to build capacity that is in each case sufficient to meet their respective requirement and those of others. It’s a palpable development that highlights our penchant for proprietary interest at all time, which unfortunately adds to the prices that consumer pays for services ultimately. The NCC needs to urgently wade into these issues to save the industry and consumers alike, through a cost study, price determination and mandatory access regulation for leased lines and other wholesale capacity services and effective enforcement modalities.

Question 5:
At various fora, Main One Cable Company has continued to clamour for the development of a national broadband policy. As an expert, what key areas should form the thrust of this policy and how can the policy help improve internet penetration?

I think the best place to begin is changing the perception towards broadband services. Contrary to widely-held belief in this part, broadband is not mere access to fast internet services for on-line entertainment on sites such as youtube or for social networking. It is a quintessential utility service that has the same level of socio-economic importance as electricity or any other social amenities. It not only benefit consumers as a service medium, it allows them to innovate, thereby powering a vibrant reproductive cycle of services and enhanced productivity that cuts across all facets of socio-economic activities in any community where there is ample access to broadband services. It drives productivity and efficiency in public and private sector activities and will impact economic growth positively. This is why, even in countries where one would ordinarily assume high level of internet proliferation, such as the United States, it remains one of the key thrust of government policies as recently as 2010 taking its position as an all-important public utility services, since these countries have come to the realization that market forces and private sector led initiatives will not meet government’s objective in this direction.

Government and policy makers in Nigeria need to take a cue from these more advance markets and develop a national broadband policy, whether as part of the on-going review of the national telecommunications policy or on a stand-alone basis, if Nigeria is to meet the MDG and Vision 2020 objectives, which fate will hang on the level of ICT development in the country going forward.

In terms of thrust of the policy, the focus should be on the demand and supply side of broadband services and should span both regulatory and economic intervention plan by government. The policy should address current regulatory challenges to local access infrastructure build by services providers and efficient utilization of existing infrastructure for common benefit and overall consumer benefit.

It should key in on government funding of access and broadband distribution infrastructure build nationwide through a special national broadband infrastructure development fund, or whatever name it may be called, that will appraise requirements and support operators with viable plans that have also shown historical ability for execution. In fact, government may, with the collaboration of the providers, build a national backbone infrastructure that can be leased to operators on a maintenance cost basis solely. The policy should also incorporate initiatives that will support broadband usage which should include digitalization of public services, promotion of local content and supporting innovation in broadband service usage through fiscal incentive amongst other consumer stimuli.

Question 6:
What is Main One doing to ensure that issues hindering broadband penetration in Nigeria are addressed by the government and other stakeholders?

As you rightly acknowledged, our approach is first to create awareness for the immense opportunities that Nigeria stand to miss out on in the global ICT trajectory if we fail to harness our resource through clear policy direction and implementation. This is why we continue to accentuate this issue at every forum where we have had the opportunity to dwell on it. We also have an elaborate plan to engage, and keep engaging, the NCC, as our industry regulator, the government and other stakeholders on these issues with a view to getting their buy-in on dealing with the challenges that the industry faces in delivering on governments ICT growth objective and how government can be persuaded for more direct policy intervention and economic support.

We know that the NCC is keenly interested in this process as a new service frontier for the industry and will support any initiative that enhances value for consumers. We continue to work with our customers and operator-partners to grow the current level of penetration through dynamic initiatives and partnership that has till date helped to deliver broadband services distribution infrastructure on trade-off basis, which has also helped to improve service penetration to other parts of the country outside Lagos.

Question 7:
Still on the policy side, industry watchers say that a converged media and telecom regulator is needed to support the telecommunications industry in delivering innovative services to Nigerians. Do you share this opinion?

Regulatory convergence has its big hit to the extent that it creates efficient ICT resource management through harmonized processes and should also save cost in industry regulation. The UK, for example, has adopted that model with the emergence of the Office of Communications (OFCOM) and I believe the FCC in the United States has responsibility for both broadcast and telecommunications. Having separate regulatory bodies for broadcast and communications, that is the NBC and NCC, certainly doesn’t optimize benefit for the industry in a world where the line between broadcast and regular telephony service is fast disappearing.

Strangely, converged services in Nigeria continue to evolve gradually, without the regulators being merged, since technology most time is regulation neutral and always ahead of regulation in any case. It may however not be sustained if we fail to get into that space on time. One of the biggest concerns that has been expressed for instance by operators on broadband service penetration is the release of 2.5Ghz spectrum, which is already in the pocket of the NBC, to telecommunications operators for WiMAX services. This, I suppose, would not occur if we had a unified regulator in Nigeria. We may never be able to take full benefit of the so called digital dividends if we continue to run parallel regulators for the telecommunications and broadcast industries.

Question 8:
Experts say that Nigeria’s poor management of national spectrum resources has hindered foreign direct investment into the telecom industry and slowed down the roll out of broadband services by telecom companies. How can the Nigerian Communications Commission (NCC) ensure that spectrum is made available quickly and with maximum transparency?

I am not an expert on spectrum management, so I am unable to comment fully on whether or not there has been poor management. I know for sure that there are series of issues on microwave frequencies and there is a clear need to sanitize usage to ensure that operators who have genuine needs have access to these limited resources and are able to serve the consumers with much desired broadband service from a distribution standpoint, whether point to point or point to multipoint. There have also been series of furor generated in the industry over “access” frequencies both from cost and availability perspective. Having some of these resources split between different regulators have not helped matters, while the cost may also be prohibitive for smaller operators. More than anything else, anytime I hear a clamor for more frequency allocation, the next thing that comes to mind is what people have done with the bands allocated to them. Have they made the most efficient use of these resources for to justify further allocation and are they truly utilizing the spectrum. Maybe that’s where the regulator shout start and focus its attention, i.e. are there operators out there who were allocated resources and are not using it for any meaningful purpose, and should this be withdrawn and given to people who are in actual need of the resources and have demonstrated execution capabilities to make ample case for allocation. I am not aware of any transparency issue, the processes have always been smooth but for the 2.3 Ghz bid fiasco in 2009.

Question 9:
Prohibitive taxation and administrative burden are negatively impacting delivery of broadband services in Nigeria. It is a key challenge facing stakeholders in increasing access to and affordability of broadband services. What can the government of the day do to address this issue?

The issue of multiple, not just prohibitive, taxation has been over-flogged by several industry bodies including ALTON and ATCON. It is also related to multiple regulatory oversights, which continue to stifle deployment of infrastructure and operations of telecommunications operators, affecting delivery of services, including access to broadband services. Until this is resolved clearly and each arm of government fully keeps within its legislative limits, and existing duplicity of oversight functions are resolved, the quality of all communication services will continue to be below desired levels and prices of services may never truly reduce.

Question 10:
A new report from the GSMA shows that by differentially growing non-oil sectors more than the oil sector, broadband can support diversification of the Nigerian economy. How can we better achieve this?

Concerted effort; government, regulator and industry stakeholders including operators and the media, we all have a role to play. We are all witnesses to the socio-economic impact of the advances made in the mobile telephony segment of the market, which has lesser positive externalities than broadband services. I read in some study recently that wireless broadband services alone will directly contribute additional N190 billion to the GDP by 2015, which will represent some 1.22% increase and 1.7% growth in non-oil sector, whilst indirect contribution could be as much as N410 billion during the same time. From crafting a well-articulated policy position and implementing it, to investing in efficient network infrastructure, playing by the established rules of the market and delivering optimum service levels to consumer, as well as subscribing to resources provided by broadband services medium, everyone has a role to play in the process.

Analysts say telcos cannot lead mobile payment schemes in Nigeria

• CBN gives out seven new approval in principle
Daniel Obi & Ben Uzor Jr

Against the backdrop of plans by some telecommunications companies (telcos) to go into mobile payment services, analysts say the move is against Central Bank of Nigeria (CBN) regulations.The analysts cited regulatory framework for mobile payment services in Nigeria issued by the CBN in 2009 which identifies three acceptable models for the implementation of mobile payment services: bank-focused, bank-led, and third party-led.

According to the analysts, the decision was made because the CBN does not regulate telcos and if the telcos are allowed to lead mobile money, it will mean putting two major segments of Nigeria’s economy in the hands of a few companies. This, they believe, bears great risks for Nigeria. An informed source at the CBN told BusinessDay that the apex bank has issued additional seven approvals in principle (AiP) to prospective mobile payment service providers in the country.

This particular CBN M-Payment regime, which has been tagged the most rigorous, the costliest and the longest-lasting in the short history of the scheme, started about two years ago with the issuance of provisional license to MoneyBoxAfrica and the subsequent release of regulatory guidelines. The issuance of the seven new AiPs takes the number of approvals to 23. Some of the companies included in the latest bazaar are Zenith Bank,MoneyBoxAfrica and Zinternet. The names of the other companies were not available at press time yesterday. There are speculations that VTN and Hendomark made the list.

But the industry is awaiting the result of the just concluded verification of the readiness of 16 firms to start services after the initial four-month trial period. Assessing the development of telcos’ foray into m-payment, Abayomi Atoloye, former director, banking and payment systems department of the CBN, expressed the view that if telcos are allowed to drive the mobile payment scheme, it will create an unequal playing field for other mobile payment operators in the country. This may also give rise to a situation in which a telecommunications company limits its services to only its subscribers.

There should be room for competition, he said. Atoloye went further on to say that “the move is intended to prevent the larger networks from dominating the mobile payment system as they have access to the larger percentage of the population as well as the infrastructure for the deployment of the new payment system.” Head of operations at 3Line, Chinedu Eluchie, said it was not healthy that telcos lead the mobile payment services as this would give them access to the data base of account holders, which is the exclusive preserve of banks.

Rasaq Olaegbe, an electronic payment expert, told BusinessDay it was not ideal for telecoms operators to take the lead in a mobile payment scheme because they lack domain expertise in financial services. “They are not licensed to offer financial services. Telcos are licensed to offer telecoms services. That is why you see MTN partnering with GTBank to roll out mobile money in Nigeria.”

Another analyst, who pleaded anonymity, said: “In the bank-based model, customers have a direct contractual relationship with a prudentially licensed and supervised financial institution, even though the customer may deal exclusively with the staff of one or more retail agents hired to conduct transactions on the bank’s behalf; while in the MNO-based model, customers have no direct contractual relationship with a fully licensed and supervised financial institution. I think this is an area banks have problems with.”

According to the framework, the telcos are required to ensure that their subscribers are free to use a mobile payment system service of their choice. They are also required not to receive deposit from the public except in respect of the prepaid airtime billing of their subscribers; and they are not to allow the use of the prepaid airtime value loaded by their subscribers for purposes of payment or to transfer monetary value. The telcos stand to benefit significantly from the success of mobile money in Nigeria as most of the transactions will be going over their networks.

In November 2010, the CBN granted AiP licenses to 16 companies to operate mobile payment in Nigeria. These operators were required to run a 4- month pilot from December 2010 to March 2011 after which, upon review, full operational licenses were to be issued. The CBN has now concluded its audit of the 16 companies and is expected to issue full operational licenses this month to those it deems ready to launch. The 16 operators are: Stanbic IBTC Bank Plc; Ecobank Nigeria Plc; Fortis MFB; UBA/Afripay; GTBank Plc/MTN, and FirstBank of Nigeria Plc. Others are: Pagatech; Paycom; M-Kudi; Chams; Eartholeum; E-Tranzact; Parkway; Monitise; FET, and Corporeti.

check out my blog, www.benedictspace.blogspot.com

Tariff wars assume new dimension as Globacom offers 100% free airtime on calls

Ben Uzor Jr

The on-going tariff war amongst telecommunications operators in Nigeria’s highly competitive market has assumed a new dimension as Globacom, Second National Operator (SNO), on Wednesday introduced a new tariff plan offering telecoms subscribers one free minute for every minute spent on the network. The new offer which comes through a new price plan tagged ‘The Glo 1derfuloffer’, launched at the, Lagos, yesterday, is devoid of any rental payments, hidden charges, and conditions.

Before hand, tariff plan rates on the Globacom network were N15 per minute for on-net calls and N25 per minute for off-net calls. With this new tariff plan, the telecom firm revealed, effective rate becomes N7.50 per minute for on-net calls and N12.50 per minute for off-net calls. This, according to the telecom firm translates into 100 percent free airtime on every call. Besides, subscribers who are on per minute billing plan get to pay only 50 percent of the total cost of every call made within the Glo network.

In addition, calls on the package are effectively charged at only N7.50 per minute. The new plan described by Mohamed Jameel, group chief operating officer, Globacom; as the best value offer in the country telecoms tariff structure gives the caller second minute free for every minute of call. Jameel said that Glo has a strong pedigree as a brand that gives so much back to the society. According to Jameel, the tariff plan was conceived to give the subscriber more value for money.

“This is signposted by this new offer. It is almost like talking for free. Our overall objective is to delight consumers and increase affinity with the Glo brand. Ultimately, subscribers will be encouraged to talk for more minutes and, by so doing, enjoy more free talk-time”, he concluded. Giving lucid insight into what subscribers should expect from the new tariff package, Adewale Sangowawa, executive director, human resources, Globacom, said, “ Subscribers would get 20 percent bonus on recharge, they will be able to make international calls at N9 per minute and get up to 200 MB data bonus.”

Still on the new tariff plan, Sangowawa, said, “The customer pays for the 1st minute, gets the 2nd minute free, pays for the 3rd minute, gets the 4th minute free, pays for the 5th minute, gets the 6th minute free and so on and so forth. In a 4 minute call, the 2nd and 4th minutes are offered free and the pattern continues for as long as the caller stays on the call. Fielding questions relating to how Globacom intends to manage the huge number of Glo subscribers expected to migrate to this new tariff plan, Ashutosh Tiwary, general manager, prepaid marketing, Globacom, said that the telecom company conducted critical test to ascertain network readiness before going live.

“We have conducted network readiness test. We also did our projections to determine the traffic levels and how many call minutes will be generated as a result of the new offer. We are continuously adding base stations in more areas. As soon as we get information that there is network congestion, we commence roll-out of new base station to address issues of poor quality of service and ensure that we provide best-in-class telecommunications services to our teeming subscribers”, he added.

“Glo gives more time to talk and talk. The more the subscriber talks, the more free talk time he gets. The free minute is available on both on-net and off-net calls. To migrate to the new package, all the subscriber needs to do is dial *100* 11*1#” he said. In the past, Globacom had introduced unique price plans that made calls much more affordable to subscribers. They include the Glo Talk More and New Infinito. With superior network quality experienced on the network, Glo is primed to ensure customers on the network engage in effective communication.

check out my blog, www.benedictspace.blogspot.com

Poor spectrum management slows down telcos’ rural broadband expansion drive

. . . FG urged to harness Digital Dividend spectrum for rural access
Ben Uzor Jr

There is growing apprehension amongst telecommunications companies that majority of the Nigeria’s population especially those who dwell in the rural communities will be denied access to efficient and affordable broadband services due to federal governments’ inability to efficiently manage our national frequency spectrum resources. Available statistics reveal that 40 million Nigerians living in about 850 villages across the country do not have access to basic telecoms services. An analyst told Business Day yesterday that Nigeria’s digital divide is still wide even with Nigeria’s 90 million active subscribers.

According to him, rural dwellers yearn to be connected to the rest of the world but have no telecoms facilities to do so. Some telecoms companies like Globacom, MTN, and Airtel have complained that their rural broadband expansion plans have been slowed down by the absence of requisite spectrum needed to rollout broadband internet services. Telecoms companies had earlier called on the federal government to as a matter of expediency harness Digital Dividend spectrum for rural access.

This, they further maintained would ensure that rural communities benefit from the GSM revolution. The digital dividend spectrum located between 200 MHz and 1 GHz offers an excellent balance between transmission capacity and distance coverage, thus enabling efficient network deployment. Due to its good signal propagation characteristics fewer infrastructures are required to provide wider mobile coverage, allowing communications services to be provided in rural areas at lower costs.

“In 2011, Globacom is making significant investment in the area of bringing best-in-class broadband services to rural areas. I am sure that other telecoms companies are doing the same because millions of Nigerians, especially those in the rural communities are yet to enjoy the benefits of the GSM revolution. As it relates to broadband deployment, spectrum unavailability is slowing down our rural broadband expansion plans. Federal government must speed up the allocation of new frequency spectrum to mobile services”, a senior executive at Globacom who pleaded anonymity told Business Day yesterday.

Kazeem Oladepo, head of legal services, Main One cable told Business Day in an interview recently that operators must reassess their spectrum strategies and find the appropriate approach to re-leverage existing 3G spectrums to deliver the scale and coverage needed to deliver affordable and efficient internet services to rural communities. As it relates to the problem with spectrum management in Nigeria, he said that a single agency, familiar with the major uses of spectrum, should manage assignment of spectrum rather than having responsibility split between two or more agencies.

“There have also been series of furor generated in the industry over ‘access’ frequencies both from cost and availability perspective. Having some of these resources split between different regulators have not helped matters, while the cost may also be prohibitive for smaller operators. More than anything else, anytime I hear a clamor for more frequency allocation, the next thing that comes to mind is what people have done with the bands allocated to them. Have they made the most efficient use of these resources for to justify further allocation and are they truly utilizing the spectrum.

“Maybe that’s where the regulator shout start and focus its attention, i.e. are there telecoms operators out there who were allocated resources and are not using it for any meaningful purpose, and should this be withdrawn and given to people who are in actual need of the resources and have demonstrated execution capabilities to make ample case for allocation”, Oladepo further added. The Main One executive argued that the current situation in matured markets like the United States (US) and the United Kingdom (UK) is that the media and telecom regulator are converged.

If this model is replicated in Nigeria, according to him, it would enable efficient management of national spectrum resources and also support the delivery of better services to Nigerians. He said that NCC had done considerably well in the area of spectrum management under the Ndukwe administration, noting that much is yet to be seen from the new administration. Wale Goodluck, corporate services executive, MTN, who spoke to BusinessDay in a telephone interview recently believes that optimal management of national frequency resources will boost rollout of innovative broadband services. According to him, spectrum unavailability is hindering telcos from expanding broadband services especially in rural areas.

“We must look at diverse alternatives to drive broadband capacity. We must also look critically at spectrum sharing. “There is a fundamental need to implement a clear spectrum policy that will lead to ubiquitous mobile broadband services. “They must ensure that spectrum is resold thus freeing up a lot of frequency not in use but held by people and institutions without requisite capacity to deploy services”, he noted. Ross Bateson, spokesperson for GSMA agrees with Goodluck, adding that government must also start to contemplate the release of low frequency Digital Dividend Spectrum.

This, he said would be instrumental in ensuring rural Nigeria benefit from high broadband internet connectivity. “The Nigerian government must also learn from recent developments in Brazil, whereby regulator ANATEL re-farmed already allocated, technology neutral, 2.6 GHz spectrum to Multichannel Multipoint Distribution Service (MMDS) operators for pay-per-view television services and had it re-allocated to operators for mobile broadband provision.”